Armenia and the EU

11/05/2016 - 14:15

Thematic Pages

EU relations with Armenia are based on the EU-Armenia Partnership and Cooperation Agreement (1999), which provides for wide-ranging cooperation in the areas of political dialogue, trade, investment, economy, law-making and culture.

The EU is committed to further developing and strengthening its cooperation with Armenia in all areas of mutual interest. Armenia was included (as a southern Caucasus country) in the European Neighbourhood Policy (ENP) in 2004 and in the Eastern Partnership in 2009.

New agreement with Armenia

On 2 January 2015, Armenia joined the Eurasian Economic Union (EEU) (with Russia, Belarus, Kazakhstan and Kyrgyzstan). Despite Armenia's decision in September 2013 not to sign the Association Agreement with the EU, including a Deep and Comprehensive Free Trade Area Agreement (AA/DCFTA), Armenia and the EU continue their political and trade dialogue in areas where this is compatible with Armenia’s new obligations to the EEU. The EU and Armenia have successfully completed a process to look into a future legal agreement compatible with Armenia's new international obligations.

On 12 October 2015 the Foreign Affairs Council authorised the European Commission and the High Representative to open negotiations on a new, legally binding and overarching agreement with Armenia, and adopted the corresponding negotiating mandate. The negotiations were officially launched on 7 December 2015 by the High Representative and the Armenian Foreign Minister and four rounds of negotiations have already taken place in Brussels and Yerevan. The new agreement will replace the current EU-Armenia Partnership and Cooperation agreement.

The strategy for cooperation under the ENI has been developed in close consultation with the Armenian authorities. An increasing share of EU financial support is provided as budget sector support, which means that certain reform targets need to be met before money is paid.

The three EU priorities are:

- Private sector development

- Public administration reform

- Justice sector reform

Greater mobility with EU

The Mobility Partnership with Armenia was signed in 2011. Both sides committed to improve mobility of people in both directions, whilst working to ensure better management of migration flows, including preventing and reducing irregular immigration. The EU-Armenia Visa Facilitation and Readmission Agreements were signed and entered into force in January 2014. Their overall implementation was assessed as good at the last EU-Armenia Joint Committees, which were held in Yerevan in June 2016.

Important trading partner for Armenia

The EU is first export destination for Armenian products, and one of Armenia's main trading partners.

The total value of preferential imports from Armenia into the EU under the Generalised Scheme of Preferences (GSP) has increased, from € 61 million in 2009 to € 116 million in 2015. Armenia's GSP utilisation rate is around 77%. The main EU imports Armenia under GSP preferences are: base metals (82%), textiles (16%) and foodstuffs (2%).

Facilitating cooperation in innovation and competitiveness

Negotiations for Armenia's participation to the EU's biggest Research and Innovation Programme HORIZON 2020 were concluded in 2015 and Armenia signed the Association Agreement in May 2016. HORIZON 2020 provides financing for research and innovation and supports Small and Medium-sized Enterprises.

The signature for Armenia's participation in the European COSME programme (Competitiveness of Enterprises and Small and Medium-sized Enterprises) took place at end of 2015. The programme promotes entrepreneurship and entrepreneurial culture, improves access to finance for SMEs and boosts their competitiveness.

The EU Delegation will provide more than EUR 23 million from 2016-2020 to business development in Armenia. The actions will range from SME policy implementation to access to finance.

Young people involved in EU programmes

There are 21 ongoing Tempus and 5 Erasmus+ Capacity Building projects with involvement of 22 Armenian universities and 31 other organizations including private enterprises, ministries and non-governmental organizations. Each project is implemented over three years with a budget of EUR 20 290 252 and EUR 4 392 388 respectively.

In addition, approximately 800 students and staff of Armenian universities participated in Erasmus Mundus projects and Erasmus Mundus Joint Master Degree Programs over the period 2004-2014. Armenia also participated in the eTwinning plus action, which included 23 schools.

A number of Erasmus+ International Credit Mobility projects are running at Armenian higher education institutions. These projects provide scholarships for bachelor, master, PhD students and staff of universities. So far, 1 443 young Armenians and youth organizations have benefited from Erasmus+ mobility projects and 123 have been involved in the specific activities targeting young people and decision-makers.

Five projects in the Erasmus+ Capacity Building in Higher Education (CBHE) 2015 initiative involve Armenian universities.

Regional programmes

Armenia also participates in regional programmes funded under the ENPI/ENI - mainly environment, energy, transport, culture and youth initiatives, in the Eastern Partnership Flagship Initiatives, in cross-border cooperation and in initiatives open to all Neighbourhood countries: SIGMA, and the Neighbourhood Investment Facility (NIF). The NIF in Armenia targets primarily investment projects in transport infrastructure, financing of small business, waste management, water and energy efficiency.

The PCA with Armenia was signed in April 1996 and entered into force at the beginning of July 1999. Since then the PCA has provided the legal framework for EU-Armenia relations and has underpinned wide-ranging cooperation in the areas of political dialogue, trade, investment, economic, legislative and cultural cooperation.

EU-Armenia Cooperation Council Agreement

The Cooperation Council supervises the implementation of the PCA. It meets at ministerial level once a year. It examines major issues arising within the framework of the PCA and any other bilateral or international issue of mutual interest to help reach the objectives of the PCA. The Cooperation Council may also make appropriate recommendations, by agreement between EU and Armenian representatives.

EU Armenia Cooperation Committee Agreement

The Cooperation Committee meets every half year and monitors the progress in implementing economic/trade chapters of the EU-Armenia Action Plan.

It includes four sub-committees at experts’ level.

Subcommittee on Justice, Freedom and Security,

Subcommittee on Transport, Environment and Energy and Nuclear Safety,

Subcommittee on Social Affairs, Public Health, Training, Education and Youth, Culture, Information Society, Audiovisual, and Science and Technology.

Subcommittee on Trade

EU-Armenia Parliamentary Cooperation Committee (PCC) Agreement

The relations between the European Parliament and the Parliament of the Republic of Armenia are conducted within the framework of the Delegation to the Parliamentary Cooperation Committee EU-Armenia.This PCC holds two meetings per year: one at one of the working places of the European Parliament (Brussels and Strasbourg) and one in Armenia.

Human Rights Dialogue

Since 2009, EU and Armenia hold Human Rights Dialogues. Human Rights Dialogues take place once per year (Brussels or Yerevan) and provide an opportunity to discuss in an open and comprehensive way a full range of issues related to the human rights situation in both Armenia and the EU.

European Neighbourhood Policy Agreement

The decision taken by the European Council on 14 June 2004 to incorporate the countries of the Southern Caucasus into the framework of the European Neighbourhood Policy (ENP) shows the EU’s willingness to extend its cooperation with Armenia beyond what is provided for under the framework of the Partnership and Cooperation Agreement.

The ENP Action Plan contains concrete goals and actions to be achieved in the short and medium term, and was agreed in November 2006. It covers democratization, human rights, socio-economic reform, poverty alleviation, energy, conflicts and other issues. Yearly progress reports assessed the progress achieved in implementing the Action Plan.

Since 2004, there have been radical changes in a large number of the countries that surround the EU. The European Neighbourhood Policy has therefore undergone a review in order to propose how the EU and its neighbours can build more effective partnerships. The EU will pursue its interests which include the promotion of universal values. The EU's own stability is built on democracy, human rights and the rule of law and economic openness and the new ENP will take stabilisation as its main political priority in this mandate. The new ENP recognises that not all partners aspire to EU rules and standards, and will reflect the wishes of each country concerning the nature and focus of its partnership with the EU.

In November 2015, the reviewed ENP was launched by High Representative Mogherini and Commissioner Hahn and endorsed by EU countries in December 2015.

Launched in May 2009, the Eastern Partnership initiative is designed to further enhance political engagement with Armenia and five other partners. The Eastern Partnership envisages a stronger political association and economic integration with the EU, with a stronger emphasis on promoting mobility, energy security, transport, agriculture, cooperation in the field of environment protection and cohesion policy.

At the Eastern Partnership Summit in Vilnius in 2013, the EU and Armenia agreed on the need to update the EU-Armenia Action Plan. An agreement was reached to revise the basis for relations, building upon the existing framework for cooperation. The next step is to reflect on how to take this process forward.

The Eastern Partnership will be further strengthened in line with commitments at the Riga Summit in 2015. The summit reaffirmed the importance of the reform agenda in the Eastern partners and the need to establish strengthened and more transparent institutions, free from corruption. Discussions focused on multilateral cooperation projects aiming at strengthening institutions and good governance, enhancing mobility and contacts between people, developing market opportunities by improving the business environment and legal certainty in Eastern European partners and focusing on the digital economy, ensuring energy security and improving the interconnections for energy and transport.

Conflict Resolution

The EU has a strong interest in a politically stable and economically prosperous Southern Caucasus. The Nagorno Karabakh conflict remains a major impediment to Armenia's socio-economic development and contributes to regional instability.

The EU complements the efforts of the OSCE Minsk Group towards a peaceful settlement of the conflict, including through the EU Special Representative for the South Caucasus and the crisis in Georgia. To promote confidence-building among the conflicting parties, the EU finances people-to-people contacts in the framework of the European Partnership for the Peaceful Settlement of the Conflict over Nagorno Karabakh (EPNK).

Other initiatives Agreement

The need to better tailor the ENP to Eastern neighbours is reflected in a number of complementary political initiatives launched by the EU:

Closer trade and economic integration with the EU can be a key factor for Armenia's economic growth. Both the EU and Armenia are members of the World Trade Organisation and Armenia benefits from GSP+ under the EU Generalised System of Preferences (GSP). In line with the objectives of the European Neighbourhood Policy and the Eastern Partnership, the EU is committed to improving Armenia's access to the European market and to encouraging further European investment in Armenia.

More information and statistics on EU-Armenia trade relations are available here.

Preferential regime (GSP+)

Armenia benefited from the general arrangement of the EU Generalised System of Preferences (GSP) in 2006-2008, which provided preferential access to the EU market in the form of zero duties on 3300 products and reduced tariffs for another 3900.

In December 2008, Armenia qualified for the special incentive arrangement for sustainable development and good governance (GSP+) under the EU GSP Regulation for 2009-2011.

The EU adopted a reformed GSP mechanism on 31 October 2012 and the GSP+ scheme for countries which implement core human rights, labour rights and other sustainable development and good governance conventions.

The EU and Armenia negotiated an agreement on a deep and comprehensive free trade area (DCFTA) offering enhanced preferential tariff rates for Armenian exports to the EU. Unrelated to the decision of Armenia not to sign the DCFTA as part of Association Agreement with the EU , Armenia got the GSP+, which has been applied as of 1 January 2014. This means that zero customs tariff will be applied for more than 6200 products manufactured in Armenia. By using the EU Export Helpdesk it is possible to identify if a preferential duty rate applies to particular product.

Under the GSP+, the European Commission will monitor Armenia's compliance with its international commitments, in particular the effective implementation of the 27 core international conventions on human rights, labour rights, environmental protection and good governance principles. The first GSP+ monitoring biennial report covering 2014 and 2015 was published on 28th January 2016. Download the report here: http://trade.ec.europa.eu/doclib/docs/2016/january/tradoc_154180.pdf

The EU Delegation to Armenia will have regular discussions with Armenia on the implementation of the GSP+ scheme including how, in 2015-2016, Armenia addressed the implementation of the 27 core international conventions.

Free trade agreement

Between 2010 and 2013 the EU and the Republic of Armenia were engaged in the preparation of a bilateral free trade agreement, the Deep and Comprehensive Free Trade Area (DCFTA).

The objective of the DCFTA was to offer to the Republic of Armenia better access to the EU market and assist the Government with their key economic reforms. During that period, Armenia was working on the implementation of these reforms with significant EU support.

Although the EU and Armenian authorities concluded these negotiations in 2013, the DCFTA between the EU and Armenia could not be signed due to Armenia's decision to join the Customs Union with Russia, Belarus and Kazakhstan, announced in September 2013.

The EU is the largest development cooperation donor in Armenia. It has provided assistance to Armenia since the country gained independence. Annual support has grown progressively since a partnership agreement was signed in 1999.

Several EU projects assist Armenia to obtain an increasingly close relationship with the EU, to meet EU standards and learn from best practices.

As per 2016, the EU Delegation to Armenia has 129 ongoing projects with a total value of €269 million. While the largest projects reflect the three main priorities above, the EU project portfolio also includes support for agriculture, migration, environment and nuclear safety as well as energy and innovation among others. Armenia is actively engaged in educational programmes, such as ERASMUS+, which also help strengthen relations between the EU and Armenia. Armenia joined the innovative research programme, Horizon 2020, in May 2016. Finally, Armenia benefits annually from the Technical Assistance and Information Exchange via the TAIEX instrument and from Twinning projects with EU specialized institutions.

ECHO in Armenia

Since 2010, the European Union’s Directorate-General for European Civil protection and Humanitarian Aid Operations (ECHO) has been implementing a Disaster Risk Reduction (DRR) program in the South Caucasus: DIPECHO (acronym for Disaster Preparedness ECHO). The programme aims at strengthening communities highly exposed to natural hazards such as earthquakes, floods, hailstorms and droughts. It boosts the communities' capacities to react, respond and recover in case of disaster. In Armenia, EU funding for DIPECHO projects has reached almost €4 million and the current, fourth phase of the programme was launched on 28 June 2015: https://www.facebook.com/eudelegationtoarmenia/photos/?tab=album&album_id=1049708265083102

DIPECHO is a proven model to save lives and livelihoods with some of the achievements being: DRR awareness significantly increased at all levels; introduction of DRR in School curriculum; inclusive DRR education to reduce the vulnerability of disadvantaged children; innovative pilot projects linking DRR with Climate Change Adaptation; strengthening capacities of disaster management authorities, national organizations and communities, and gradually include DRR in government policies and development plans.